Michael Rustad, ‘Punitive Damages in Cyberspace: Where in the World Is the Consumer?’

Abstract:
This Article presents the results of the first empirical study of the role that punitive damages have played in redressing consumer injuries during the first decade of Internet-related litigation. This article examines the case characteristics of Internet lawsuits where plaintiffs initiated causes of action in state and federal courts in the United States between 1992 and 2002. The analysis of plaintiffs’ victories in Internet cases has a domestic focus, employing a database that includes virtually all U.S. plaintiff victories in Internet cases. This database permits the first comprehensive examination of: (1) the frequency of punitive damages in Internet cases; (2) the specific causes of action on which the remedy was based; (3) plaintiff and defendant characteristics; and (4) the role punitive damages plays in the cyber-litigation system. A content analysis of all Internet-related cases reveals that no consumer obtained punitive damages during a decade of cyberlaw litigation. Tort remedies have the potential of filling the gap left by ineffective criminal sanctions against cyberwrongs such as online stalking. Public enforcement needs to be augmented by consumers operating as “private attorneys general” who pursue punitive justice against cyberlaw wrongdoers. At present, punitive damages serve as a form of corporate self-help to assist corporations in protecting rights and consolidating market share in cyberspace. I explore the reasons why punitive damages have not yet developed as a consumer protection remedy in cyberspace. This Article will demonstrate that punitive damages are a necessary consumer remedy against Internet wrongdoers where the probability of discovery is low and the harm to consumers is generally undetected and unpunished by public authorities.

Rustad, Michael L., Punitive Damages in Cyberspace: Where in the World Is the Consumer? (March 1, 2012). Chapman Law Review, Vol. 7, p. 39, 2004; Suffolk University Law School Research Paper Forthcoming.

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